Only 12% customers getting service charge removed from restaurants’ bill despite it being ‘voluntary’

Even after one year of the service charge being declared ‘voluntary’, mere 12% customers asked restaurants to remove it from their bills, a survey has shown. The Consumer Affairs Ministry last year clarified that the ‘service charge’ levied by restaurants and hotels is ‘voluntary’ and customers can refuse to pay it altogether or pay only to the extent they wish to pay. In fact, a consumer court ruled in favour of a customer, saying that he as not bound to pay the service charge if he didn’t like the service.

While only 12% declined to pay the service charge, about 32% did not pay attention to the fact that their total bill was inclusive of the service charge, a survey of 7,661 consumers conducted by LocalCircles showed. About 29% said that they paid the service charge willingly. Many restaurants are still adding the service charge between 5% and 20% in the bill without customers’ consent.

However, since about a year ago, “more consumers have started standing up against the practice of Service Charge when visiting restaurants and asked to pay a service charge,” the survey said. In total, 39% of those who went to AC restaurants did not pay the service charge, the survey added. In may last year, the number was only 27%.

There is a need to create more awareness about the service charge being optional, said consumers in the survey. In many cases, some restaurants put up a signboard or a disclaimer on the menu that they ‘levy service charge’, in order to be able to refuse customers’ request. But, even in such cases, customers have the right to not pay the service charge, a Consumer Affairs Ministry official told FE Online earlier pointing to the guidelines issued by the ministry.

In November last year, a consumer, whose request to remove service charge from the bill was declined, moved to the consumer court and was awarded a total of Rs 10,000 in compensation. In the Jai Jeet Singh vs Punjab Grill Restaurant, a Mumbai-based consumer court ruled that the food and the food and services were not up to the mark and the complainant (Jai Jeet Singh) is not “bound” to pay service charges as charged by the opponent. (Punjab Grill Restaurant).

Since the government’s clarification on the service charge being voluntary is only a directive and not a law yet, the consumer can move to consumer court if their request for removing the service charge from the final bill is declined.